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India Bullion: Up tracking COMEX on weak dollar, less hawkish US Fed

Informist, Thursday, Jul 28, 2022


By Chinmay Mungse


MUMBAI – GOLD and SILVER contracts on the Multi Commodity Exchange of India and COMEX rose today as the US dollar index slipped after the US Federal Reserve’s monetary policy meeting.


* The Federal Open Market Committee raised interest rate by 75 basis points at its policy meeting. While this was already factored in by the markets, Fed Chair Jerome Powell’s comments hinted that the pace of rate hikes might be eased.


* “Gold prices rallied after US Fed hiked key interest rates by 75 bps in line with market expectations. The Fed agreed that economic activities have slowed down and was less hawkish in their comments which drove prices to high,” said Tapan Patel, senior analyst at HDFC Securities.


* Powell said the Fed could slow the pace of future interest rate hikes. “As the stance of monetary policy tightens further, it likely will become appropriate to slow the pace of increases while we assess how our cumulative policy adjustments are affecting the economy and inflation,” Powell said.


* Powell’s statements improved risk appetite and put on the greenback, which boosted the demand for the precious metals, said experts.


* At 1707 IST, the most active contracts of bullion were:
   –June gold was up 0.7% at 51,060 rupees per 10 gm on MCX
   –June gold was up 1% at $1,735.7 an ounce on COMEX
   –September silver was up 2.6% at 56,290 rupees per kg on MCX
   –-September silver was up 3.7% at $19.27 an ounce on COMEX


* Outlook for the evening session:
   –MCX gold seen at 50,900-51,700 rupees
   –COMEX gold seen at $1,730-$1,760
   –MCX silver seen at 54,400-56,200 rupees
   –COMEX silver seen at $18.88-$19.68.




US$1 = 79.75 rupees

IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT


Edited by Aditya Sakorkar


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Source: Cogencis

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